Breakingviews: Goldman envy

July 16 - Jeffrey Goldfarb and Antony Currie discuss why the second-quarter results at Goldman Sachs fail to put much distance between it and its rivals.

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Affirmative longer in the interview Wall Street Goldman Sachs has not yet quite Indy again. We came out some great results today but I can't -- curry very error sort of not what we've come to expect from you look at its hotline number and looks great they'd -- estimates by a bath. It says they made nice profit like an adult and able -- incomes doubled compared same period last year which is tricky for number of them. And it all looks final not put any -- digging down because there's nothing wrong with their but you start -- not answer that it's the how they don't this is what analysts are expecting. And yet if you look at that fixed income trading which is the big thing we have a best mindful. During that is for the crisis it's fine. They weathered the storm of the past six -- -- weeks as others have as well. But is not as if they have outperformed their rivals like -- dynamic and we're hoping that obviously took quite I don't understand as they prepared generally known to. Completely surpassed that exists in the processor that that basically in ninety to compare its last deal the first quarter. To equities trading is up or down compared to respect -- a little bit but not much competitiveness and got little help from some tax cuts I think that they they any -- some percent tax rate than last put up compared to about city to city 3% the previous sequels as. So that added to an extra 158 million that's the -- in my -- you take that happened at that wonderful ten point 57 -- -- that was of the crying about it but it's just about will see these banks and that drops below 10% which is what we see is some rule of thumb for. Making how are they sets so against peers there obvious they have of them are very JPMorgan at city of what we're already at their tax credit on our return in the back -- -- there had a city that behind Jacob moment. Okay so what what else whether it's an asymmetric you're saying -- -- -- -- it's it's it's pretty flat it's great. It's not their main business that trying to bring them up from from Arab receives notice burnings basically a pretax margins they were -- is they're not doing too well compared to days. But the revenue that's in pretty flat the past -- set to get some plant for. Just about the stepped up big gap that we're just sick. What about other terms of calm and it's obvious of course a lot can't let that stay up pretty consistent on commenting we said them for the first -- they dropped the comp to revenue. Ratio of five percentage point also they kept that this quarter's 43% cut -- If you look back to last did what they do -- eight days from loaded in the first his record isn't in the final court -- -- the -- -- much federation so maybe this comes in a fully vet medicine they're still that's request whatever that's ever holding I think something close -- expect some more capital that they weren't pre crisis. -- still try to figure out. How about how the model works for example but it is right there with a few minutes or is there any sense from what -- is saying today about where this is going. Not not sick that they had the leverage ratio came out last week for example -- that. This and this is very much. A beginning of -- rule that we need to know as proposed will we know what that thing's going to be that we feel pretty -- from wanting to set when he -- companies have what I mean to be tricky with Uga I just mean. Comfortable -- -- -- that that the that was pretty good at some of it's walking around that. The fruits and sent to capitol that's fun that she sold reinsurance business in the Cordoba is puzzles retreat felt badly. -- tough sentence points that of that policy capital ratio. Country of seventeen billion capital can not batting that -- -- a business that is just little things like that go along look to see -- me. If they can whether they can act as big distance between erotic art. We'll be back with more bank earnings and breaking -- tomorrow.

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